The SRA held an event on the 5th June warning law firms not to wander from the path of compliance whilst economic times are tough. The warning from the Chief Executive of the SRA, Anthony Townsend, specifically cautioned solicitors about getting involved in stamp duty land tax (SDLT) schemes as a way to make quick money.
He said: “…We are concerned that firms might see this as an easy way to make some extra money, especially those who were previously reliant on conveyancing work.”
Mr Townsend’s reference to SDLT schemes came under the more general issue concerning the link between a difficult economic climate and the higher number of regulatory breaches.
He said:
“Our experience suggests that some firms, particularly those in financial difficulty, are becoming involved in particular schemes when it should be clear that they are either inappropriate or not implemented correctly. Some of these schemes raise potentially serious issues for consumers and it is vital that improper schemes are not promoted or used by law firms.”
HMRC have expressed their concern about SDLT schemes and in light of this the SRA have said they are keeping a close eye on firms involved in such schemes. The figures held by the Inland Revenue for SDLT can be compared against those held by the SRA to see if they match up and it is in those cases where they do not that the SRA are referring to.
The SRA did express that they have no issue with firms who deal with legitimate tax planning but reminded legal firms that clients rely on solicitors to advise them as to whether a scheme is in their best interests. Withholding advice and information from clients on SDLT schemes could result in unwanted consequences and legal implications, and could damage public confidence in the sector.
